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01/10 17:23
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Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call presented strong financial performance with a 26% revenue increase, robust gross profit margins, and a significant net profit rise. The Q&A section highlighted positive developments like potential FDA clearance, strategic financing, and successful collaborations. Despite increased expenses, efficient cost management and strong cash position support financial health. The reiterated revenue guidance and strategic expansions further bolster a positive outlook. Given these factors, the stock price is likely to experience a positive movement in the short term.
Revenue $12.6 million, representing a 26% increase compared to $10 million in the same period last year. The increase is attributed to strong sales performance and growth in recurring revenue streams through multiyear lease agreements.
Deep TMS Systems Shipped 88 systems shipped during the quarter, representing a 35% increase compared to the same period last year. This growth is due to increased demand and successful customer engagement strategies.
Gross Profit $9.5 million, up $2 million from $7.5 million in the prior year period, maintaining a strong gross margin of 75% in both periods. The stability reflects the strength of the recurring revenue model and disciplined cost management.
Sales and Marketing Expenses $4.9 million compared to $3.8 million in Q2 2024, an increase of $1.1 million. The rise is driven by targeted investment in commercial expansions and marketing programs.
Research and Development Expenses $2.3 million compared to $1.7 million last year, an increase of $0.6 million. The increase is primarily from ongoing clinical trials and development activities.
General and Administrative Expenses $1.6 million compared to $1.4 million in the prior year period, an increase of $0.2 million. The rise is mainly due to additional legal fees and due diligence costs related to the Stella investment and other initiatives.
Operating Profit Approximately $600,000, in line with the same period last year. Stability in operating profit reflects disciplined cost management and strong revenue growth.
Adjusted EBITDA $1.5 million, up from $1.3 million in the prior year period. The increase is attributed to strong revenue growth and efficient cost management.
Net Profit $2 million compared to $0.6 million in the same period of 2024. The significant increase is driven by strong revenue growth and operational efficiency.
Cash Position $78.3 million in cash, cash equivalents, restricted cash, and short-term deposits, up $8.7 million from the end of 2024 and up $30.2 million from the same point last year. The increase is driven by strong collections and offset by a $5 million investment in Stella MSO.
Deferred Revenue $62 million, a 25% year-over-year increase. The growth is largely due to advanced collection from a significant multiyear agreement with a growing mental health network.
Deep TMS systems: Shipped 88 systems in Q2 2025, a 35% increase compared to the same period last year, bringing the total installed base to 1,522 systems.
Accelerated treatment protocol: Submitted data to the FDA for a new protocol for major depressive disorder treatment, aiming to improve convenience and appeal to patients.
Global expansion: Focused on broadening patient access through global expansion and health system integration.
U.S. mental health network partnership: Secured an extensive order of systems with a multiphase delivery plan through the end of the year by a fast-growing U.S. mental health network in the Western and Southern U.S.
Recurring revenue model: 70% of customer engagements are multiyear lease agreements, with a backlog of $62 million in signed agreements.
Financial performance: Achieved record quarterly revenue of $12.6 million, a 26% increase year-over-year, and maintained a strong gross margin of 75%.
Minority investments: Made a $5 million investment in Stella MSO, a management services organization for mental health clinics, as part of a broader strategy to invest in complementary enterprises.
Educational initiatives: Funded two new CME courses to expand clinician knowledge and confidence in Deep TMS usage.
Geopolitical and Supply Chain Factors: The company acknowledges risks from shifts in market conditions due to geopolitical and supply chain factors, which could impact operations and financial performance.
Regulatory Approvals and Clinical Data: Dependence on regulatory approvals and clinical data for market differentiation poses a risk if approvals are delayed or clinical data does not support product claims.
Accelerated Treatment Protocol: The success of the accelerated treatment protocol for Deep TMS is uncertain and could impact the company's ability to attract prospective patients if not well-received.
Investment in Mental Health Providers: The strategy to invest in mental health providers carries risks, including potential financial losses and challenges in managing partnerships effectively.
Increased Operating Expenses: Rising sales, marketing, and R&D expenses could pressure profitability if revenue growth does not keep pace.
Customer Retention and Multiyear Agreements: While customer retention is high, any decline in renewals or multiyear agreements could impact recurring revenue streams and financial stability.
Revenue Guidance: The company has raised its full-year 2025 revenue guidance to a range of $50 million to $52 million, representing 22% to 27% growth over 2024 revenue.
Operating Profit and Adjusted EBITDA: BrainsWay expects operating profit in the range of 4% to 5% of revenue and adjusted EBITDA in the range of 12% to 13% for the year.
Market Expansion and Strategic Investments: The company is actively pursuing investments in mental health providers and enterprises complementary to its business, with plans for additional investments following the $5 million financing transaction with Stella MSO. These initiatives aim to expand market awareness, R&D capabilities, and access to Deep TMS.
Clinical Advancements: BrainsWay is progressing with an accelerated treatment protocol for Deep TMS for major depressive disorder, which could improve convenience and appeal to prospective patients. The company is also working with the Israel Ministry of Defense to qualify PTSD patients for Deep TMS.
Deferred Revenue and Backlog: The company has a backlog of signed agreements with remaining performance obligations totaling approximately $62 million, providing strong visibility into future revenues.
The selected topic was not discussed during the call.
The company demonstrates strong financial performance with increased revenue, gross profit, and net profit. The positive cash flow and substantial cash reserves further enhance financial stability. The raised revenue guidance and promising market expansion initiatives are optimistic. The Q&A section reveals potential growth through accelerated protocols and minority investments, despite some management ambiguity. Overall, the company's strategic investments and market expansion efforts indicate a positive outlook, likely resulting in a stock price increase within the 2% to 8% range.
The earnings call presented strong financial performance with a 26% revenue increase, robust gross profit margins, and a significant net profit rise. The Q&A section highlighted positive developments like potential FDA clearance, strategic financing, and successful collaborations. Despite increased expenses, efficient cost management and strong cash position support financial health. The reiterated revenue guidance and strategic expansions further bolster a positive outlook. Given these factors, the stock price is likely to experience a positive movement in the short term.
The earnings call reflects strong financial performance with a 27% revenue increase and significant growth in Deep TMS system shipments. The company is expanding internationally and maintaining robust margins. Despite geopolitical risks and supply chain concerns, management remains optimistic, supported by positive clinical data and market expansion strategies. The lack of a share repurchase program is a minor negative, but overall, the guidance and financial health suggest a positive market reaction over the next two weeks.
The company reported strong financial performance with a significant increase in revenue and profitability, alongside optimistic guidance. The Q&A highlighted high demand and potential growth in OCD and MDD treatments. While there are risks like regulatory scrutiny and supply chain challenges, the positive market response to new product developments and stable gross margins contribute to a favorable outlook. Despite the lack of a shareholder return plan, the overall sentiment is positive due to the promising market potential and financial health.
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